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Agrochemicals to be more costly in Brazil’s 2017/18 season

Agrochemicals will cost more for producers during the 2017/18 season in Brazil.

The projection is from the president of the Director Council of the National Association of Vegetable Defense (Andef), Eduardo Leduc. According to him, the reason is the devaluation of the ‘dollar’ against the ‘real,’ which has changed constantly the prices of the inputs paid by the industries.

“For us, the suppliers, it is hard to price the agrochemical since each lot that we imported we paid a different price for the inputs,” Leduc affirmed.

He said during the last season, the values were between 10% and 15% cheaper in comparison with the previous years. “There will be a recovery of prices because the companies passed through a moment of very low profitability due to the exchange rate variation.”

Data from the National Union of the Industry of Vegetable Defense Products (Sindiveg) shows that the sales of sector was R$ 9.5 billion in 2016, reflecting a fall of 1% compared with the previous year. To have an idea about the weight of the dollar in the sector, nearly 414.9 thousand tons of products were imported last year.

Leduc also highlighted that the sale of products for the next cycle has been delayed in comparison with the previous crop. “There is a high offer of grain and a fall in prices for the producer, who is awaiting the best time to sell the produce, which delays preparations for the new crop.” According to him, sales should be concentrated in the second semester.

According to the Leduc, farmers can protect themselves from this fluctuation of values by seeking to lock prices. He pointed out the barter operations, which is the payment of inputs with grain, as an advantageous alternative of negotiation: “The more the producer can achieve this hedge, the less he will be exposed to fluctuations.” He estimated that this modality of payment responds to 15% to 30% of the sales in the country.

“It is possible to increase yields between 30% and 40% with the adequate use of technologies in all of the property, since soil management, seed choice, pesticides that allows an integrated vision and not only combats specific plagues,” Leduc concluded.